It’s funny how many outside of the FI community view us. Since we save so much money, they think we must live dull and boring lives. A common perception is we live meager lives and never allow ourselves the simplest indulgence for fear it might cost us a few bucks in the future. For many of us high savers, that’s simply not the case.
We currently save around 45% of our income. I have goals to become a millionaire by age 40 and become financially independent soon after that. Despite saving a high percentage of our income, we don’t live in squaller like some think. There are several areas we could cut back if we wanted to. Doing so would move our financial independence date up by a few years at least. But life is all about trade-offs. We’re comfortable with our current standard of living and we’ve elected to trade a few years of independence to spend more on the things that are important to us.
While we don’t spend our money like many picture a high-income household would, we do spend more in other areas. Here are four areas where we splurge more than the average FI seeker.
Back in our leaner days, we used to shoot for $50 a week on groceries. At the time, we were living on one income while paying for my wife to go back to school, so most expenses were cut to the bone. Our goal then was buying food as cheap as possible, and thus the Walmart Neighborhood Market was where we frequented the most. We have some not so fond memories of dealing with the crazies at Wal-Mart in those days. From crazy old racists guys to the people who thought it was ok to stand in the produce section eating grapes. Weird shit just happens at Wal-Mart.
As our incomes have grown, so has our budget for groceries. I think as a whole, Americans are way too concerned with the quantity of food they get as opposed to the quality, but that’s a whole other topic. We’re also big on supporting local farmers at our farmer’s market. Just this past weekend we dropped $40 on two dozen chicken eggs, a dozen duck eggs, asparagus, and radishes. It costs a lot more than going to Wal-Mart, but the quality is much better, and we’re supporting someone’s livelihood.
As far as eating out goes, we don’t eat out a ton. Typically once per week, we’ll hit up one of the many great local restaurants in Kansas City. Right now we’re doing what we call Fat Kid Friday where we go out to eat at a local restaurant and then indulge at one of our favorite ice cream shops. Limiting to just once a week helps keep our food budget somewhat in check as well as our waistlines.
I spend a lot on golf. Two years ago I joined a country club right by my work. I was surprised at how reasonable the dues are for junior members which go through age 39. Am I getting my money’s worth? That depends on how you look at it. From a pure dollars and cents standpoint, no. Unless you’re retired or play every night after work, I don’t think that’s possible. And even then there are cheaper options if you want.
But I love the convenience being that the 10th green is literally 300 yards from my office. I can play a quick nine in the morning before work, shower up and then head to my office across the street. The course is fantastic and for the most part, the pace of play is quick. The average round is under four hours, which is way better than the public courses in my area. If there’s one thing I can’t stand in golf, or anything for that matter, it’s waiting. So for me, paying extra for the convenience and quality of play is worth it.
My wife is smarter than me and chose a less expensive sport to pursue. She has been running since college and has now run marathons in 17 different states. Only 33 more to go! She goes through a lot of shoes running that many miles, and race entries can get expensive. They typically run up to $100, although the major ones like Boston are much more. It costs more than the average weekend runner, but it keeps her driven and she really loves running in the races.
As I write this, I’m staring at a map above my desk with pins stuck in each city we’ve traveled to as a couple. We’ve seen so many great cities in this country and have so many on our ever growing list. I’ve never been to the northwest part of the states, or the very northeast, but can’t wait to check them out in the future.
We’ve also been to five other countries with plans to visit many more in the near future. Spain, Italy, Iceland, New Zealand, Germany, and Japan are just a few that are on our list.
This year we’ve traveled to Phoenix and will be going to Kauai, Maui, Nashville, Las Vegas (2nd time this year for me), and possibly somewhere in Wisconsin for a marathon. I’m really excited for Hawaii as we’ve been talking about making a return trip ever since our honeymoon 10 years ago. And for Vegas – well, you never have to ask me twice for a trip to the greatest place on earth.
While we don’t skimp on the number of destinations we travel to, we do make an effort to keep costs reasonable where we can. Flights are typically booked on Southwest when possible and we stay at affordable hotels like the Hampton Inn or Courtyard by Marriott. We still haven’t used Airbnb, but plan to in the future. As long as we’re close to the action and some great local restaurants, we’re good to go.
Spend on Things That Matter
The key when it comes to saving and spending money is finding the things that truly bring happiness to you. Will a new car bring happiness to your life? Or will the excitement it brings wear off once the new car smell is gone? Will a huge house way out in suburbia to match the one your friends just bought bring you happiness? Or will that euphoria wear off once another friend buys a bigger house?
Before buying something, ask yourself if you would still buy it if no one else could see it. Would you buy that BMW 3 Series if it just looked like a Honda Acord to everyone else? What about a Rolex? Would you buy one if those who saw it could only see a plain old Timex? Or even a YETI tumbler. Would you buy it if it looked like a styrofoam cup to everyone else at your office?
Readers, what do you splurge on? Have you splurged on anything in the past that you regret now? Why do you think so many people spend their time making money only to buy things that don’t bring them long-term happiness?